FMC Adds Two Carriers to List of Controlled Ocean Carriers

Wednesday, July 22, 2015

Sandler, Travis & Rosenberg Trade Report

The Federal Maritime Commission has published an updated list of controlled carriers, which are subject to special regulatory oversight by the FMC. Since the last publication of this list in Aug. 2012 the FMC has added two carriers (CNAN Nord SPA and United Arab Shipping Company (S.A.G.)) The other four carriers currently on the controlled carrier list are American President Lines Ltd. and APL Co. Pte., COSCO Container Lines Company Limited, China Shipping Container Lines Co. Ltd and China Shipping Container Lines (Hong Kong) Co. Limited, and Hainan P O Shipping Co. Ltd.

A controlled carrier is one that is, or whose operating assets are, directly or indirectly owned or controlled by a government, meaning that (a) a majority of the interest in the carrier is owned or controlled in any manner by that government, an agency of that government or a public or private person controlled by that government or (b) that government has the right to appoint or disapprove the appointment of a majority of the directors, the chief operating officer or the chief executive officer of the carrier. The FMC may prohibit the publication or use of a rate, charge, classification, rule or regulation that a controlled carrier has failed to demonstrate is just and reasonable. Congress enacted these protections to ensure that controlled carriers, whose marketplace decision-making can be influenced by foreign governmental priorities or by their access to non-market sources of capital, do not engage in unreasonable below-market pricing practices that could disrupt trade or harm privately-owned shipping companies.